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Mergers provide an effective means of corporate re-organisations. Discuss with reference to the Companies Act.
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Mergers provide an effective means of corporate re-organisations. Discuss with reference to the Companies Act. A merger or an amalgamation may take place in two ways; 1) 'Company A may transfer its assets and liabilities to company B, with the shareholders in company A being given shares in company B and company A being dissolved, leaving the business of the two companies effectively merged'; or 2) 'It may be decided to form a new company, C, to whom the assets and liabilities of A and B are transferred, with the shareholders of A and B being given shares in company C and companies A and B are then dissolved. In this case A and B have amalgamated to form a third company, C1'. Mergers are classified as either horizontal, concentric, conglomerate or vertical mergers. A 'horizontal merger' or a 'horizontal integration' usually indicates an amalgamation between two or more companies from the same...
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